D'Angelo v. Cornell Paperboard Products Co.

• Decision Date: 05 June 1973
• Docket Number: No. 315,315
• Parties: James D'ANGELO, Plaintiff, Employers Mutual Liability Ins. Co., Intervening Plaintiff-Appellant, v. CORNELL PAPERBOARD PRODUCTS CO., Defendant-Appellant, Indemnity Ins. Co. of North America, Interpleaded Defendant-Respondent.
• Court: Wisconsin Supreme Court

Page 846

207 N.W.2d 846

59 Wis.2d 46

James D'ANGELO, Plaintiff, Employers Mutual Liability Ins. Co., Intervening Plaintiff-Appellant, v. CORNELL PAPERBOARD PRODUCTS CO., Defendant-Appellant,

Indemnity Ins. Co. of North America, Interpleaded

Defendant-Respondent.

No. 315.

Supreme Court of Wisconsin.

June 5, 1973.

Gibbs, Roper & Fifield, Milwaukee, for appellant.

Kivett & Kasdorf, Milwaukee, Clifford C. Kasdorf and Russell M. Ware, Milwaukee, of counsel, for respondent.

HALLOWS, Chief Justice.

The only issue presented is whether Indemnity's comprehensive automobile liability policy extended insurance coverage when a forklift was involved. Employers contends the court has already intimated that the forklift in this accident was an automobile within the definition of Indemnity's policy; in the second D'Angelo case, this court only considered whether a forklift was a motor vehicle for the purpose of the direct-action statute as it was then written. ³ Whatever construction we gave the direct-action statute does not decide whether an insurance policy covers a specific vehicle.

In interpreting and construing an insurance contract, '. . . the objective should be to ascertain the true intention of the parties.' Home Mut. Ins. Co. v. Insurance Co. of North America (1963), 20 Wis.2d 48, 51, 121 N.W.2d 275, 277; Inter-Insurance Ex. v. Westchester Fire Ins. Co. (1964), 25 Wis.2d 100, 104, 130 N.W.2d 185. Ambiguities in an insurance contract are to be resolved against the insurer who drafted it and in favor of the insured. Kopp v. Home Mut. Ins. Co. (1959), 6 Wis.2d 53, 94 N.W.2d 224; Luckett v. Cowser (1968), 39 Wis.2d 224, 159 N.W.2d 94.

However, where no such ambiguity exists, the rule of strict construction against insurers is not applicable. Leatherman v. American Family Mut. Ins. Co. (1971), 52 Wis.2d 644, 190 N.W.2d 904; Westerman v. Richardson (1969), 43 Wis.2d 587, 168 N.W.2d 851. To do otherwise would be '. . . to bind an insurer to a risk which it did not contemplate and for which it was not paid . . .' Inter-Insurance Ex. v. Westchester, supra, 25 Wis.2d at p. 104, 130 N.W.2d at p. 188.

These general rules apply between insurance companies where one insurance company's rights depend upon subrogation of the insured. In this case we do not think it makes any difference whether a strict construction or a regular construction is given Indemnity's policy. We find no ambiguity calling for strict construction and we cannot apply that rule of interpretation to create one.

In ascertaining the intention of Cornell and Indemnity, the contract should be construed whenever possible so that each sentence, phrase or word used will have some meaning, and none of the language discarded as superfluous or meaningless. Rabinovitz v. Travelers Ins. Co. (1960), 11 Wis.2d 545, 105 N.W.2d 807; Lontkowski v. Ignarski (1959), 6 Wis.2d 561, 95 N.W.2d 230; Inter-Insurance Ex. v. Westchester Fire Ins. Co., supra.

In construing a contract, the particular construction given to it by the parties thereto is of some importance, that is, the conduct of a contracting party while acting under the contract--can be on some facts a 'most persuasive' element in construing an insurance contract. Taylor v. Hill (1893), 86 Wis. 99, 56 N.W. 738; Home Mut. Ins. Co. v. Ins. Co. of North America, supra; Inter-Insurance Ex. v. Westchester Fire Ins. Co., supra. Here, Cornell, the insured, immediately notified its public liability carrier Employers of the forklift accident. However, Cornell did not notify its automobile liability carrier for over a year and a half; indeed it is stipulated that Cornell felt its public liability insurance provided the applicable coverage. As late as July 29, 1959, Cornell's assistant secretary-treasurer informed the automobile liability carrier that Cornell assumed its automobile policy with it was not relevant to this accident.

We do not need to decide whether a forklift is or is not an automobile within the policy definition. On appeal, Employers contends the trial court, in making its decision, used the word 'coverages' in its conclusory sense, i.e., whether or not a person or vehicle is 'covered' by the policy. Coverage or coverages as that word is generally used refers to the sum of risks which an insurance policy covers. See Smith v. National Indemnity Co. (1973), 57 Wis.2d 706, 205 N.W.2d 365; Freimuth v. Glens Falls Ins. Co. (1957), 50 Wash.2d 621, 314 P.2d 468; Seabaugh v. Sisk, (Mo.App.1967), 413 S.W.2d 602. Employers argues that it is because of the policy's reference to 'any automobile' in the insurance clause and therefore any accident caused by the use of the forklift comes within the coverage of the policy. Assuming a forklift is an automobile, we do not read the policy, or find the intention of the parties to cover them in the automobile policy, nor can we accept Employers' argument that the insuring clause overrides other parts of the contract. The insuring clause is broad and must be read with all the terms of the policy. Insurance policies are 'created' by taking standard forms and adding standard endorsements in the...